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Believes HMSI runs the risk of being labelled just a scooter makerBy:BS Reporter |Published :April 01, 2011 

Rajiv Bajaj is an aggressive mood and thinks Honda Motorcycle and Scooter India (HMSI), the country’s fourth biggest two-wheeler maker, faces the risk of being labelled just a scooter maker in India.

Nearly 55 per cent of HMSI’s sales come from scooters even though the company has more motorcycles in its portfolio. The company has a market share of 43 per cent in the automatic scooter segment and sells three models under the category. But HMSI has seven motorcycle models, which account for 45 per cent of sales.

Bajaj says “there is a growing perception that Honda can make scooters only. Customers go to Honda for scooters and come to us for bikes. The perception is that Honda cannot make motorcycles and we should maintain that perception”.

Bajaj was explaining the expected increase in competition in the domestic two-wheeler market following the break-up of the 26 year old joint venture of Hero Honda. Honda now has more headroom for expansion as it is now free to enter the bike segment. That is where it will compete with Bajaj Auto.

Bajaj Auto moved away from scooters a little more than a year back after sales of its automatic scooter, Krystal, started to decline. The company has said it does not plan to re-enter that segment.

Bajaj saw sales rise by 38 per cent during the April-February period at 2,194,522 units as against 1,586,984 units reported in the same period a year back, according to SIAM data. HMSI on the other hand saw sales of 600,000 units of motorcycles during the same period, a growth of 53 per cent.

HMSI is unable to satisfy the burgeoning demand for Activa, its top selling automatic scooter. The present waiting period on the model is extending to nearly 10 months in some markets, according to sales representatives at dealerships.